While all attention is currently on Iran (and the energy impact of actions overseas), today’s CPI (for February) should not be affected by the recent surge in WTI (but March’s data definitely will be)…
Source: Bloomberg
Headline CPI rose 0.3% MoM (as expected), lifting prices by 2.4% YoY (unchanged from the prior month at the lowest since May 2025)…
Source: Bloomberg
The disinflation trend is still your friend as the terrors of tariff-flation remain non-evident, much to the disappointment of establishment economists.
Core Services remain the biggest driver of CPI with Core Goods relatvely unmoved (and Energy starting to pick up)…
Core CPI also met expectations with a +0.2% MoM move, leaving prices up 2.45% YoY – the lowest since March 2021
Source: Bloomberg
Core CPI Services are also the main driver of Core CPI (but are seeing significant disinflation)…
SuperCore CPI (Services ex-Shelter) lifted very modestly on a YoY basis with Medical Care Services the biggest driver…
While typically, a hot (or cold) CPI would drive stocks and bonds dramatically, we remain beholden to the slings and arrows of outrageous crude oil price fortune (for now) with rate-cut odds remaining near recent (hawkish) cycle lows.
Both Goods and Services costs are signaling disinflation (ahead of March’s potentially explosive moves)…
The question is – how long will the impact of soaring energy costs impact CPI?
Is it different this time?
